Managing Organizational Change—a.k.a. Juggling

What is organizational change and why it matters, or should.

Fact: No newly deployed enterprise-technology solution reaches its full potential without a corresponding organizational change. The reason: Even the best technology solution, if not embraced by the workforce within a business-transformation scheme, operates at less than its full capabilities.

This is why forward-thinking enterprises, when deploying new ERP systems, are wise to consider three vital aspects of organizational-change management: technology, processes and people.

Only by juggling all three at the same time, can momentum develop and continue.

This momentum, which must be greater than inherent resistance to change in workplace processes, results when project teams agree on the following elements:

• Shared need and clear reason why the status quo no longer is viable.
• Shared view of the desired future state and a clear sense of direction.
• Clearly defined next actions and ownership.

Organizational Change Management

The 8-Step Process for Leading Change methodology from leadership change expert John Kotter provides a useful blueprint for establishing the necessary framework for successful organizational change.

A recent project with Warren, ME-based Knox Machine Co., a make-to-order machining company, provides one example. For more than 40 years, it supplied close-tolerance machining to the defense, communications, aerospace and plastics industries. It was apparent that its legacy ERP system no longer could support the business adequately.

Knox Machine used an awkward collection of business-management tools: Excel spreadsheets for inventory control and reporting functions; various manual processes for material planning and shop-floor execution; and one accounting software for financials and another solution for quoting, order entry, purchasing, shipping and job costing.

The inevitable consequence of such a cobbled-together solution: an enterprise lacking an integrated view of the business, and having no true process flow among standalone systems. Moreover, because planning was paper-based, the system was prone to human error, resulting in inaccurate data.